Can SolarCity Scale Energy-Efficiency Services Like Solar Roofs?

Eric Wesoff is Editor-at-Large at Greentech Media. Prior to joining GTM, Eric Wesoff founded Sage Marketing Partners in 2000 to provide sales and marketing-consulting services to venture-capital firms and their portfolio companies in the alternative energy and telecommunications sectors. Mr. Wesoff has become a well-known, respected authority and speaker in these fields.

His expertise covers solar power, fuel cells, biofuels and advanced batteries. His strengths are in market research and analysis, business development and due diligence for investors. He frequently consults for energy startups and Silicon Valley's premier venture capitalists.

SolarCity, the distributed energy financier and utility, just sent out free software to 16,000 of its customers that lets the homeowner order energy upgrades with "one click," according to co-founder and CTO Peter Rive. From this point on, all SolarCity customers will receive the software as well.

“Traditional efficiency audits generalize energy expenses, fail to pinpoint the source of problems and leave consumers guessing about possible solutions. It’s like providing a symptom without a diagnosis,” said Rive.

The software, armed with an image of the home, audit, weather, and DOE data, can rank improvements and upgrades in the sometimes-difficult balance required in energy-efficiency upgrade alchemy. SolarCity claims that its experience as an energy efficiency contractor "allows it to provide accurate cost data for specific upgrades and connect the customer with the ideal contractor."

Rive called the software a "simulation engine" that looks at every component of the building that is "using or leaking energy." He said the software can look at the components themselves or at the way the components interact with each other.

Armed with its software, the consumer can take a look at energy trouble spots in the home, make an informed decision, and see the exact statement of work (SOW) that a contractor would perform for that particular measure, along with project costs and estimated savings.

"This is a dream come true from a contractor's experience," said Rive, adding that it was a "closed sale" at an "agreed-on price with a captive customer," and since the SOW is specified, it "removes the risk of a change order."

For the contractor, the customer acquisition cost is known and consistent -- it's the referral fee paid to SolarCity based on a percentage of the job.

Rive sees this as "a way to scale energy efficiency the same way" that solar has been scaled, adding, "The market is massive."

A DOE study found that the U.S. consumers spend $241 billion annually on home energy bills. That’s one in five of the dollars the U.S. spends on energy -- an average of $1,900 per family.

Screenshots of SolarCity's Energy Software

SolarCity software detailing the statement of work for specific efficiency measures (click to enlarge)